4 
6 | § ¶I Like Visibility
-- And You Don’t Get it In Large Companies
I like the work I do to be felt across every single employee in the company, and recognized too! I want every employee in the company to recognize that their paychecks depend on me.
Sounds ambitious? Not so. That is the feeling you have in a small company. The best employees - those who cause the most impact to sales – are recognized and remembered by anyone. You stopped being “Jose Anes”, and you become just “Jose”, even when there are other three Jose’s in the same office. You are the one and only. Every employee in the company greets you by name, even when you don't remember all of their names.
You do not need to be in sales to be felt. You just need to do something so important that the company would not survive without you: and in small companies this is something achievable. The engineer with the grand idea that changed the company. The operations guy who changed the office layout into a more productive and comfortable one. The marketing guy that launched the campaign that raised sales by 10%.
The problem: In large company you have to be in a very high level management position to create this impact. Small companies haven’t showed me the money lately. The large company of dubious reputation that I work for shows me more money. I haven’t received a very high offer from a small company.
The potential solution: I am willing to go to a small company for less salary, any good small company, as long as I get a significant ownership on that company. I want to have a piece of the company that I am helping build again.
The question is: How do we get to that solution? How do we get a company that offers a significant amount of ownership in exchange for success?? How do I get an opportunity to create massive ammounts of cash through ownership and direct involvement??
4 4 | § ¶Always Tip Cash?
-- I Like to Tip By Charge Card
I have heard many people suggest that you should always leave your waitress tips in cash, as opposed to by credit card. I have heard several reasons, along with my thoughts on them:
- Cash tips are not reported in the W-2 forms and save the waitress money in taxes -- Not necessarily true, sometimes, when the tips are not recorded, the restaurant owner has to estimate them. However, they usually estimate them on the low-side, saving some taxes to the waitress. I do not believe in willingly helping anybody commit tax fraud. I help people use lawful ways of reducing tax liability, but hiding earnings from Uncle Sam is fraud. Some people justify waitress tax fraud on the fact that they earn $2 an hour. Besides the fact that I do not justify fraud I have to point out that if they wait a single table of four for an hour and the table consumes $80 in food and beverage, they earn around $10 in tips. $12/hour is a better salary than a supermarket checkout person, who has to report all his/her earnings to Uncle Sam.
- Credit Card Tips are Shared Among All Service Personnel - True in some restaurants, but usually not the case. But those restaurants also ask the cash tips to be placed in a common pot – if they pocket the tip cash, then they are breaking the agreement with their peers.
- Credit Card Companies Charge Commissions on Tips - This one is probable true. Credit Card companies charge a commission on the charges you make on them. The restaurant owner may reduce the tip to cover the tip’s commission. I have read some articles that suggest that credit card users leave more tips than cash users, which may compensate.
I believe people should just leave the tip on the same method that they use to pay the meal. Don’t make your life more complex than it has to be.
Third Party Content
The creditcard facility enables you to make purchases on credit while retaining cash in your wallet for an emergency. A popular credit card is the citicard which is the Citibank credit card. Spending on your credit card earns you reward points which you can redeem against other products and services. All secured credit cards in the market offer reward points on spending. The bank of america card offers rewards on your credit card. The rewards visa whereby consumers can redeem their reward points online is an added feature of credit cards. Whenever you plan to apply for a credit card, do keep the added features and benefits in mind. Go for low interest credit cards to keep within your budget. The hsbc credit card is an example of low interest credit card. 5 6 | § ¶Do We Care About Our Personal Gain?
-- Do We Still Have The 'Invisible Hand'?
Adam Smith, on The Wealth of Nations, suggests that society will improve by means of an “invisible hand” that will steer it in the right direction. It will happen out of the desire of every person to maximize his gain, and not necessarily that of society.
...every individual necessarily labours to render the annual revenue of the society as great as he can. He generally, indeed, neither intends to promote the public interest, nor knows how much he is promoting it. By preferring the support of domestic to that of foreign industry, he intends only his own security; and by directing that industry in such a manner as its produce may be of the greatest value, he intends only his own gain, and he is in this, as in many other cases, led by an invisible hand to promote an end which was no part of his intention. Nor is it always the worse for the society that it was no part of it. By pursuing his own interest he frequently promotes that of the society more effectually than when he really intends to promote it. I have never known much good done by those who affected to trade for the public good. -- Adam Smith, 1776, An Inquiry into the Nature and Causes of the Wealth of NationsThe question I have is: Could it be that 200 years later, the people of the U.S.A. have so much (money, benefits, comfort) that they do not see the need for gain and try to find emotional gain in trying to solve other people’s needs? And the cororally of this statement: Could it be that by loosing the personal gain desire, we have lost the “invisible hand” that moves society in the right direction?
Yes, we all certainly want more of what we have got. But gone are the days on which people feared cold, hunger, clothing, or even the lack of luxuries (or affordable luxuries). Once pressing needs go away, we may have enough time to think about what we call “social issues” – or other people’s problems. Getting more and more goes to the backseat, and so does the “invisible hand” theory. At that time we start having conversations about how to solve them, instead of working so hard that our effort makes the whole nation stronger.
Adam Smith and Karl Marx could have made mistakes in their philosophically opposed treaties. Karl Marx’s treaty proved a failure once, with the Soviet Union. Could it be that Adam Smith’s treaty was also a failure? Or could we trust the “invisible hand” will come back to save us from our current path?
4 2 | § ¶What the Election Mean for Me
-- Concerns, Concerns, Concerns Everywhere
The mid-term Election went as I was expecting – not necessarily as I would have liked. At the Federal Level there is a Democrat control of the House, and at best an evenly divided Senate (vote counts not finished), but most probably Democrat controlled Senate. Since the Congress and the Executive Branch are from different parties, the best that could be hoped for is that they try to live together in peace for 2 years and approve ‘mainstream’ changes to our legal system. Gone are the hopes for solving nationally affecting issues: like an extension on tax cuts, immigration reform, or even fixing Social Security.
At the State level it means a Democrat Party controlled government, with a governor that has a more interest in having "conversations and consulting with profesionals" than on moving the state ahead. His major idea on his website is to help the disabled and the old – neither of whom help the economy in any way. He will help the state congress pass laws that help provide affordable housing and social benefits, while keeping taxes at the current level or even raising them. Corporations will probably suffer if he adds tax burden to them – right now Corporations are fleeing Taxachusetts. Many are going to Rhode Island, Arizona, Utah, and other corporation friendly-states. My major concern is that, according to wikipedia, he supports a single-payer (government-wide) health care system: trading my premium care health care insurance for a system that gives every person the same level of care: in other words, a mediocre one.
In six states, local minimum wage laws where enacted or raised. I am a strong believer that minimum wages should be set at levels that make sense to local economies, not at the Federal level. If each of the 50 states had their own minimum wage law, it would make less sense to fight for a Federal increase.
Still, there is some hope. Assuming individuals are still concerned about themselves, we can trust Adam Smith’s “invisible hand” theory, that society will fix itself in some way – not because of an interest in a better society in itself, but because an interest in self improvement.
1 7 | § ¶Did You Voted Today?
-- It Impacts Your Pocket
Voting is not only about whom you like or who doesn’t. It is not about who talks pretty or can be admired. It is mostly about who will use your tax-dollars for the purposes that interest you the most.
The Office of Management and Budget is kind enough to publish very valuable information that all of us should be reading. For example, look at the following information:
| Category | 1962 | 2005 | 2006 (Projected) |
| Defense | 46.9% | 19.2% | 18.9% |
| Health, Human, Housing | 4.1% | 25.3% | 25.4% |
| Social Security | 15.5% | 22.7% | 21.9% |
| Treasury (Payment on Debt) | 0% | 16.5% | 16.7% |
| Education | 0.8% | 3.0% | 3.1% |
Most of us pay money to the Federal government in the way of taxes, fees, and social security taxes. Our employers also pay a social security tax on our behalf. Corporations pay taxes as well (cutting into the earnings you get through stocks on your 401k plan, for example). Out of all of that money the Federal government takes, 18.9% gets spent on Defense (military), 25.4% gets spent on social services (not counting social security), and only 3.1% on Education.
States also have their own budgets, collection methods, and spending habits. I do believe that localized spending is more efficient than Federal spending, but I have used Federal budget because it affects the widest amount of readers. I prefer higher state taxation/spending and lower federal taxation/spending.
Which areas do you value most? Which areas you want to see reduced? Do you want to see all of them reduced (less taxation)? Do you want to see all of them increased (more taxation)?
2 3 | § ¶Flashbacks from Far Away
-- Unfinished Business?
It is not very often that I hear voices in my head, if at all. I guess I am too quick to decide on what to do, since I do not even feel the “angel vs. devil” cartoons on the top of my head. Maybe I do not even ask for opinions to my own conscience, or I do not even have a conscience – but that is a different story…
What I think I do have is constant flashbacks of random scenes from my life – usually of places I only visited for a very brief amount of time, and most of the time I was alone. They happen for no particular reason, completely unrelated to the current happenings in my life. I just drift away for a few seconds, see them in front of me, in vivid color, even smells and feelings, and then… just like the came, they go. Read More
3 3 | § ¶529 Plans and Life Insurance
-- It is easy to be afraid of death and education
I love financial institutions, I really do. They provide instruments so that we can build a safe and stable life. The problem is that financial salespeople often sell the instruments that make the less sense on a particular situation – most probably motivated by the gain margins on these products.
An example is life insurance for a young, childless, and wifeless guy. Unless his parents depend on him, there is little reason to have life insurance of any kind. Yet, financial salespeople tend to sell to them, mostly on fear: to lock in rates, to make sure he stays insurable, and all of that. Nice reasons, but rarely cost-effective. These young, dependent-less people take life insurance because they are afraid of dying – a lot more than they are afraid of becoming disabled (disability insurance), having their apartment robbed (renter’s insurance), or even having a hurricane flood their houses (flood insurance).
Same thing happens with 529 plans. 529 plans are mostly for high income earners or small business owners/employees. See, those working for small business may not have access to employee sponsored retirement accounts. And high earners may already maximized their 401k, Individual Retirement Accounts (IRA), and other qualified retirement plans.
You may ask yourself what does retirement has to do with education? Thanks to our convoluted taxation system, a lot! See, federal rules take into account the money on 529 plans to calculate what portion of the college expenses the family of a kid can pay. However, federal rules do not consider the money on qualified retirement plans into the equation (colleges may, but for the education funds they have privately acquired).
To make things more interesting, money in an IRA (or a 401k plan converted into an IRA) can be used for education expenses without paying penalties.
It makes perfect sense to contribute to 529 accounts, but only after you are contributing as much as you can to your qualified retirement accounts. This means contributing roughly $15,000 to a 401k and up to $4,000 to an IRA (lot of money considering that most families earn about $40,000 a year). As I mentioned, 529 accounts are for those families earning in excess of $100,000/ year or for those that do not have access to employer sponsored retirement plans like the 401k’s or SIMPLE-IRAs.
So then why do people flock into 529’s before maximizing their retirement accounts? People are frightened – almost as much as they are afraid of dying. The idea of an uneducated child scares people – at least some people. Plus, education is a “sure thing” – while some people even think they can work until they die. (Education is a time pressing need – the child will reach college age sooner than you are forced to enter retirement.)
Like many things in life, it is all about how you market them. An IRA and a 529 may be investing in the same underlying vehicle (mutual fund). However, if your financial sales guy things you will put more money into the 529 than in the IRA, he/she will most probably try to get you to get the 529 rather than the most efficient and flexible one: the IRA.
3 4 | § ¶Dead People Can’t Pay Their Loans
-- Don’t Take Debt Insurance Unless You Really Need It
Young people are often enticed to take a Life Insurance Policy on their Auto Loans, or even Credit Card Debt. The salesperson tells the young guy/gal that if they die, their estate will not have to pay for the debt. How nice of them!
The reality is that no-one had to pay for the loan – the estate does not inherits debts, whatever is not covered by the individual’s assets at the time of death is written off by the bank! (However, it is true that if the bank can’t recover their money, they will take the assets that where backing it away – it is not as if you can get to drive your car after you die.)
Of course, the bank is very happy to make sure that you have no excuses to pay off your debt, even if you die. But it doesn’t benefit you at all.
What is worse: the cost of debt related life insurance is usually higher than Term-Life Insurance for comparable amounts. Even if you have a wife and ten kids and want to be sure they can pay off the house, the Hummer, the Volvo, and the Mini-Van, you are better off getting term insurance rather than four individual debt insurance policies.
My advice: just save those few bucks that you would pay in debt insurance and put them into your IRA. By the time you are about to die you would have paid the car, the house, and will have a nice nest egg.
4 1 | § ¶Diplomacy Backed by a Strong Military
-- Strong according to who?
Most people, me included, think that Mr. Rumsfield has not done a good job as a Secretary of Defense handling the War in Iraq. He should offer his resignation to the President. Going into battle without a plan to obliterate the enemy in a very quick timeframe is unnaceptable. In my opinion he has not contributed to showing the world that we have a strong military.
One of the biggest problems America is facing is that the world perceives it as weaker than it was. We are experiencing weaker dollar, rising consumer debt, rising national debt, and fatter people who lead to a stressed health system. Add to that the fact that the world is getting educated and the US is not getting itself as educated as other industrialized nations. America looks weak, and weaklings are easy to topple from power. I resent that, since I like the idea of being a citizen of the only superpower. I want it to remain as the superpower, not as the almost-powerful nation.
I already pointed out a few things on which we, as a nation, need to improve. One that has been called upon by the leaders of the Democratic Party is the need for a strong(er) military. Senator Kerry, 2004 Presidential Candidate wrote about the need to “add two divisions to the 10-division Army.” (A Call to Service: My Vision for a Better America, ISBN: 0670032603, October 2003). Senator Clinton uses carefully selected words (you may have heard them on the campaign trail):
“We need to return to patient diplomacy, backed by military strength and informed by American values.“ and also “Second, we must value diplomacy as well as a strong military.” - Senator Clinton at the Council on Foreign Relations (October 31, 2006)The question that I have is, what does military strength means? For all of the million dollar missiles, or the billion dollar planes we have, some people do not perceive the military as strong. Armies with far smaller budgets appear to be kicking our rear in battle. Mr. Husain himself delighted in telling his followers that he kicked the US out of Iraq on the first Gulf War – he even built the Mother of All Battles Mosque to celebrate it. The mosque was inaugurated a month before September 11th happened (a coincidence on timing, I truly believe, but certainly a way of showing the world that America was weak and an easy target.)
If you think that America needs a strong military to back a peaceful diplomacy, we need to show the world that the military is real. The only way it is shown is by winning in undisputable ways – rendering any enemy engaged in combat unable to raise again (and I do not mean the country, but the political faction in power) – just as happened with the Japanese empire and the German Nazis on World War II, where the countries raised in better ways than before but the offending political powers where obliterated.
The U.S. military has not shown real strength since the World War II. Sure, they have made operation that has guaranteed Democracy persists, even after a lengthy cold war with Communism, and now terrorist threats in multiple fronts. I am sure our Servicemen are performing to the top of their abilities, and I am sure that they can perform better than any army in the world. But reality is that America has retreated (conceded defeat) in all long military engagements since World War II (Korea, Vietnam, and Gulf War I).
A U.S. Soldier may do 10 times the damage enemy ones do, but for as long as the U.S. Military is perceived as weak, it is less than effective, and our diplomatic power (as Senator Clinton suggests) is compromised.
If you believe that diplomacy has to be backed by a strong military (and you do not have to believe Sen. Clinton), we can’t risk showing the world we are weak. Not by conceding defeat to a political faction on Iraq (and bringing back the troops immediately), nor by doing any other kind of half missions on which troops don’t finish the objective. Don’t let it happen again.
3 3 | § ¶Criminalization of Shampoo – Part II
-- Effectiveness Questioned
The team of incredibly intelligent people at the Homeland Security Department and the Transportation Security Administration have decided that you can carry toiletry liquids and gels on travel-sized bottles on your carry-on baggage. The measure is, again, a reminder that we are in a War on Terrorism. A constant reminder for those of us that earn our living by traveling rather than doing any real work (the word “travel” comes from French “travail”, the literal equivalent of “work”). In my opinion, it just serves as that, a constant reminder, not an effective measure.
The reasoning by the TSA is that they have been able to determine what amount of liquids are harmful. In reality, I believe they just feared a massive strike by all of the Business Travelers – or they feared a backslash like the lawsuit that Ryanair launched against the UK Government due to the losses it was causing them. US Airlines recently reported the amount of losses they have due to US Policies. They didn't send any lawsuits to Washington, but I am sure they threatened (or rather I should say lobbied) with them.
Lets see the deficiencies:
- There is the restriction to a one quart sized bag full of toiletry bottles that are labeled 3 ounces or less. Yes, that is right, “labeled”. If you carry an 6 ounce package that is half full it is no good. But again, you just need the label any package to “3 ounces”. I am sure that people who mean harm to our country can manufacture new bottles.
- You can carry multiple bottles with the same liquid. As long as they are all small, they don't really check the specific content of the bottles. Assuming there is a lethal amount of toothpaste, people could be carrying it in.
- It is funny how many “packages” I put on the belt these days. It is funny how the number of things that have to be placed on the x-ray machine just keeps growing. This increases the cost of security, a cost that we end up paying in either higher ticket costs, or higher taxes. Nowadays I put:
- My laptop bag.
- My laptop.
- My carry-on (a boarding-bag).
- My toiletry, zip-lock bag.
- My jacket.
- My pair of shoes.
I think we should do away with the liquid/gel ban altogether. Maybe have better x-ray machines capable of 'sniffing' for dangerous materials. But let people be free to leave their lives!